The quick ratio, often called the acid-test ratio, measures how well a company can meet its immediate liabilities using its most liquid assets, such as cash, marketable securities, and accounts receivable, excluding inventory for a more stringent assessment compared with the current ratio. Quick assets are used to calculate the quick ratio. This provides a more immediate view of a company’s liquidity. An ideal quick ratio can vary across different industries.
What is Quick Ratio? Meaning, Formula, & More
